Will the Next Generation Console be the Last?

As the video games industry evolves, so does distribution of video games. Recently, digital downloads have become the main form of distribution for all games. It ranges from indie titles to AAA games. Ubisoft‘s CEO, Yves Guillemot, predicts the next generation of consoles will be its last. Guillemot’s belief is that cloud-based streaming services will dominate the gaming industry and games will be available on any screen rather than console exclusive. Although streaming games aren’t common, Guillemot believes as technology advances, it’ll become the mainstream.

Microsoft spoke to Variety that gaming is about having the ability to access your game from any system. Smartphones and tablets bring in the highest profit for gaming companies and it can be argued that the growth is due to the ease of accessibility. Being able to play your games on a handheld from anywhere is consumer friendly than buying a video game console for dedicated players. Guillemot stated that streaming “is going to help the AAA game industry grow much faster…we have to work on the accessibility of those games to make sure they can be played on any device.”

Whose on board?

While Microsoft and Ubisoft see this as the future of gaming, Nvidia is already taking steps to start streaming video games to any computer. Nvidia announced their beta streaming service, Nvidia’s GeForce Now, this year at CES. It’s designed to offer digital games to even basic computers. It will even port your Steam games to GeForce Now so that you won’t have to repurchase your games. The games run properly as its stream from Nvidia datacenters throughout the United States.

Phil Spencer, Executive Vice President of gaming for Microsoft, is looking towards different ways Microsoft can do for gaming. They have a unique form of distribution as they sell computers and video game consoles. Spencer stated, “I care less that people can play Minecraft on an Xbox One, but that people can play Minecraft no matter what console or device they have in front of them.” Since 2016, Microsoft stopped announcing the sales numbers for the Xbox One. While clearly doing worse than the PS4, Xbox has tried alternative distribution of games such as cross distribution with the Windows Stores and Xbox Live and their stellar backwards compatibility. “I look at investing into three key areas: content, cloud, and community – that is, making great games, making the experience of accessing and playing them better and improving things for the players overall. It helps lead gaming for everyone – not just Microsoft – into a better place for everyone.”

What about PlayStation and Nintendo?

One example of streaming being utilized is for Resident Evil 7: Biohazard for the Nintendo Switch. Although there are physical versions, the Japanese exclusive port will be a stream version only. This may be a taste for things to come. However, Nintendo launched the Switch last year to rave reviews and has sold more than 1 million units in a year. The Switch is a unique console that can be a handheld and console. PlayStation didn’t comment on the trend towards streaming. However, John Kodera, the president and CEO of Sony Interactive Entertainment (SIE), stated that the PlayStation 4 is in its final phase for the life cycle. He also mentioned an interest in handheld gaming rather than streaming service. Hopefully, they’ll do a better job for their next handheld after the PS Vita which recently stopped manufacturing physical games.

Streaming Pros and Cons:

It cost less for companies as they don’t have to pay for packaging and discs. Video game development has become more expensive. A prime example is God of War (2018) which cost $44 million. This also saves money for companies. Retailers currently take a cut of the profits of $15 for new video game sales. The cost of making, packaging and shipping game discs to stores cost $4 each. Finally, not all games sell, so the expense of returning unsold inventory eats up another $7. A Con would be for consumers with Wi-fi issues. If you have a poor internet connection, your gameplay will be choppy or have a low framerate.